Podcast
Questions and Answers
What is one primary function of corporate social responsibility (CSR) for companies?
What is one primary function of corporate social responsibility (CSR) for companies?
- To eliminate all employee grievances
- To promote competition among employees
- To monitor and report performance and risks (correct)
- To maximize short-term profits for shareholders
How does good corporate governance benefit shareholders?
How does good corporate governance benefit shareholders?
- By increasing bonuses for executives
- By ensuring favorable media coverage
- By enhancing the visibility of the company
- By protecting shareholder investments (correct)
What action can a board of directors take to promote ethical governance?
What action can a board of directors take to promote ethical governance?
- Focus solely on financial metrics
- Establish a non-competitive workplace
- Conduct regular salary reviews for employees
- Set the tone at the top for ethical principles (correct)
What is an effective way to manage conflicts of interest within a company?
What is an effective way to manage conflicts of interest within a company?
Who is primarily responsible for creating an ethical culture in a company?
Who is primarily responsible for creating an ethical culture in a company?
What must a company do to effectively oversee its ethics and compliance program?
What must a company do to effectively oversee its ethics and compliance program?
Which of the following enhances shareholder values effectively?
Which of the following enhances shareholder values effectively?
How can a company educate its employees about managing conflicts of interest?
How can a company educate its employees about managing conflicts of interest?
What must corporate social responsibility (CSR) do beyond mere compliance?
What must corporate social responsibility (CSR) do beyond mere compliance?
What is a limitation of conventional CSR reporting practices?
What is a limitation of conventional CSR reporting practices?
How should organizations account for their societal and environmental impacts according to the article?
How should organizations account for their societal and environmental impacts according to the article?
Which historical aspect is discussed regarding the development of social, environmental, and sustainability accounting and reporting (SESRAR)?
Which historical aspect is discussed regarding the development of social, environmental, and sustainability accounting and reporting (SESRAR)?
What is a proposed improvement for corporate governance reforms in the context of CSR?
What is a proposed improvement for corporate governance reforms in the context of CSR?
What do the authors argue is necessary for true CSR accountability?
What do the authors argue is necessary for true CSR accountability?
What emphasizes the role of accounting in CSR according to the article?
What emphasizes the role of accounting in CSR according to the article?
Which change is recommended for CSR reporting practices?
Which change is recommended for CSR reporting practices?
What is a primary benefit of referring to a comprehensive framework for Corporate Social Reporting (CSR)?
What is a primary benefit of referring to a comprehensive framework for Corporate Social Reporting (CSR)?
How do ethical risks differ from ethical opportunities in corporate decision-making?
How do ethical risks differ from ethical opportunities in corporate decision-making?
Why is ethical decision-making crucial during crisis management?
Why is ethical decision-making crucial during crisis management?
What aspect of Corporate Social Responsibility is highlighted through the examples provided in the content?
What aspect of Corporate Social Responsibility is highlighted through the examples provided in the content?
Which model can provide a useful template for assessing a company's CSR performance?
Which model can provide a useful template for assessing a company's CSR performance?
What is a common outcome of failing to manage ethical risks effectively?
What is a common outcome of failing to manage ethical risks effectively?
Which of the following best represents an example of leveraging ethical opportunities?
Which of the following best represents an example of leveraging ethical opportunities?
What challenge do professional accountants face regarding corporate social performance reports?
What challenge do professional accountants face regarding corporate social performance reports?
Flashcards
Corporate Social Reporting (CSR)
Corporate Social Reporting (CSR)
Growing in importance for larger companies, CSR involves reporting on a company's social and environmental impact. It's essential for avoiding criticism and maintaining stakeholder support.
Ethical Risks (in CSR)
Ethical Risks (in CSR)
Potential harms arising from unethical practices, such as damage to reputation, financial loss, or loss of stakeholder trust.
Ethical Opportunities (in CSR)
Ethical Opportunities (in CSR)
Creating value through ethical practices, like sustainability or diversity, that enhance trust.
Crisis Management & Ethical Decision-Making
Crisis Management & Ethical Decision-Making
Ethical decision-making is crucial in crisis management because it shapes long-term operations and reputation more significantly than everyday decisions.
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Ethical Decision-Making in Crisis
Ethical Decision-Making in Crisis
Making ethical choices during a crisis is vital because it is difficult to recover from bad decisions made in a crisis, which damage reputation.
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Comprehensive CSR Framework
Comprehensive CSR Framework
A framework to guide a company's CSR reporting, ensuring nothing is missed and comparisons to industry standards can be made.
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Accountability in CSR
Accountability in CSR
Companies are held accountable for their actions related to social and environmental concerns.
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Professional Accountant and CSR Audits
Professional Accountant and CSR Audits
The question of whether accountants have the skills to audit the social and environmental performance of companies is raised.
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Corporate Social Responsibility (CSR)
Corporate Social Responsibility (CSR)
A company's responsibility towards society and the environment, going beyond mere compliance and profit maximization.
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Social, Environmental, and Sustainability Accounting and Reporting (SESRAR)
Social, Environmental, and Sustainability Accounting and Reporting (SESRAR)
Accounting practices that report how companies impact society and the environment, moving businesses towards greater accountability.
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Accountability in business
Accountability in business
Businesses being responsible for their actions and impacts on society and the environment.
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Traditional CSR limitations
Traditional CSR limitations
Older CSR approaches are often limited by a focus on mere compliance and philanthropy, not necessarily improving societal impact.
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Sustainability accounting
Sustainability accounting
Process of assessing and reporting a company's impact on the environment.
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Stakeholder engagement
Stakeholder engagement
Incorporating the perspectives and needs of all parties affected by a company's actions.
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Ethical governance in business
Ethical governance in business
Implementing systems and practices assuring fair and ethical behavior within a business.
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CSR reporting practices
CSR reporting practices
Methods used by companies to communicate information about their CSR efforts.
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CSR impact on companies
CSR impact on companies
CSR (Corporate Social Responsibility) allows companies to monitor and report their performance and risks.
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Corporate Governance's impact
Corporate Governance's impact
Good corporate governance affects multiple stakeholders (shareholders, employees, customers, community) by promoting fairness and sustainability.
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Board of Directors' ethical role
Board of Directors' ethical role
Board members set the ethical tone, oversee ethics programs, and enhance shareholder value through transparency and engagement.
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Conflict of Interest Management
Conflict of Interest Management
Companies manage conflicts by defining policies, training employees, monitoring activities, and implementing resolution mechanisms.
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Ethical Culture
Ethical Culture
An ethical culture supports employees acting ethically by setting clear expectations and encouraging responsible actions.
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Who builds Ethical Culture?
Who builds Ethical Culture?
Company leadership creates and maintains an ethical work environment.
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Stakeholder Perspectives in Governance
Stakeholder Perspectives in Governance
Corporate governance should consider shareholder concerns through communication and engagement.
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Conflict Resolution Methods
Conflict Resolution Methods
Conflict resolution involves active listening, respectful communication, and open minds to resolve conflicts.
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Chapter 4 - Practical Ethical Decision Making
- Stakeholder rights include life, health and safety, a reasonable return on investment, freedom of speech, and fair treatment.
- The first resource for ethical guidance in business and accounting is often commonly accepted social norms, corporate codes, or ethical frameworks.
- The most common measure of shareholder well-being is profit/loss.
- Pastin's approach to stakeholder impact analysis includes rule ethics, ground rule ethics, end-point ethics, and social contract ethics.
- The modified moral standards approach includes utilitarian, individual rights, justice, and virtues.
Modified Pastin's Approach to Stakeholder Impact Analysis
- Ground rule ethics: Defines an organization's and/or individual's rules and values.
- End-point ethics: Determines the greatest net good for all concerned.
- Rule ethics: Determines the boundaries a person or organization should follow based on ethical principles.
- Social contract ethics: Determines how to resolve boundary concerns and conflicts.
- Virtue ethics: Determines if the motivations, virtues, and character traits demonstrated are ethical.
List of Ethical Decision-Making Pitfalls
- Focusing on short-term profit and impacts that only affect shareholders.
- Conforming to an unethical corporate culture.
- Misinterpreting public expectations.
- Focusing only on legalities ("if it's legal, it's ethical").
- Being biased toward a specific stakeholder group.
- Conflicts between personal vs. corporate interests.
- Failing to identify all stakeholder groups.
- Failing to rank the specific interests of stakeholders.
- Failing to assess well-being, fairness, and other rights.
- Failing to consider the motivation for a decision.
- Failing to anticipate actions of a decision affecting a specific group.
Character Traits
- Norms
- Moral judgment
- Virtues
- Values
- Ethical judgment
- Externalities
- Surrogates
- Future impacts
- Collateral damages
- Ethical costs
Virtue Ethics
- Focus on a person's character traits and virtues rather than their actions.
Stakeholder Impact Analysis
- Failure to identify all relevant stakeholder groups for effective analysis may result from bias, conforming to unethical corporate culture or conflicts of interest.
- For ethical decisions, virtues expected, benefits outweighing costs, and adherence to stakeholder rights and fair distribution of benefits/burdens must be considered.
Ethical Decision-Making Frameworks
- Consequentialism (well-offness)
- Deontology
- Virtue ethics
- Distributive justice
- Moral imagination
Stakeholder Impact Analysis
- Consideration of well-being/consequentialism, rights/deontology, fairness/justice and virtue considerations are important for determining ethical decisions.
- Expected values of a decision are measured by multiplying the value of an outcome by its probability.
Short Answer Questions-Chapter 4
- Discuss the practical steps to ethical decision-making (hiring, codes of ethics, training, and ethical climate).
- Detail the ethical aspects of codes of ethics within a company.
Chapter 5 - Corporate Ethical Governance & Accountability
- Corporations are accountable legally to shareholders and stakeholders.
- Internal auditors and ethics officers must report regularly to the Audit Committee of the Board of Directors.
- Principles are more helpful than rules when dealing with new situations.
- Codes must be reinforced by tone at the top, ethic officers and internal auditors and ethical culture.
Chapter 6 - Professional Accounting in the Public Interest
- Essential features of a profession include extensive training, a license or certification, and providing crucial services to society.
- Honesty, integrity, and objectivity are pivotal professional values.
- Professional accountants owe primary loyalty to the public.
- Moral reasoning stages include pre-conventional, conventional, post-conventional, and principled.
Chapter 7 - Managing Ethics Risks and Opportunities
- Dimensions of COSO Enterprise Risk Framework include strategic, operations, reporting, and compliance.
- Risk assessment involves assessing the potential for ethical risk, identifying activities, and using information and communication, and continuously monitoring activities.
- Ethics and ethical culture are essential in governance, risk assessment, information and communication, and control activities.
Chapter 7 - Stakeholder Pressure and Ethical Responsibilities
- Strategies for handling high and low threat/cooperation from different stakeholders includes monitoring, involvement and discussion and defending.
- The GRI recommends that companies report on economic, environmental, and social performance.
Chapter 7 - Financial Reporting Fraud
- Auditors have duties to consider in fraud, which include discussion/brainstorming, fraud triangle, interviews with management, and development of training programs.
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